Money Gold and Silver Report: Market Wrap

Gold closed down -1.62% at $878.80 (continuous contract). During the week it hit an intraday low of 865.00. So far, the important $850.00 price level has held. From last week’s report:

$850 is a key support level, as it is the high of the last bull market, and it marks a significant inflection point for the present bull market. It is important for price to remain above this level.

MACD has made a negative crossover, which suggests more downside action to come. It appears that $850 is going to be tested.

The weekly chart below shows a possible inverse head & shoulders formation in the making.

Silver

Silver was down -3.29% for the week, closing at $12.34. Silver has broken its bottom trend line and appears to be setting up to make a negative STO cross over. In last week’s report I said:

I have been bullish on silver and remain so, especially long term, however, I’m not thrilled about the recent action. What started out as a short term correction may be morphing into an intermediate term move.

Not only did silver break its lower trend line, but as the next charts shows, it looks like the STO indicator is rolling over and setting up for a negative cross. If this occurs it would suggest that lower prices lie ahead.